Do I Need Uninsured Motorist Insurance If I Have Full Coverage?

by Andrew Gellert
"Full coverage" can be a deceiving term.

Although it sounds reassuring, "full coverage" isn't a specific type of car insurance coverage. It's just a package deal that can vary from policy to policy. It may lack important elements of insurance coverage, such as uninsured motorist or under-insured motorist coverage.

Uninsured Motorists

Among the several types of car insurance coverage, uninsured motorist coverage is special in that it protects against the risk that the other driver in an accident won't have any insurance of his own. Legally, all drivers are required to have some minimum level of insurance; the amount of the minimum varies per state. One of the required types of insurance is liability insurance, which pays for the other driver's costs in the event that the accident was your fault. An uninsured motorist is one who lacks liability coverage, meaning that if you get into an accident, you have to pay all the costs on your own out of your own pocket and insurance.

Uninsured Motorist Coverage

Uninsured motorist coverage protects against that risk. If you have uninsured motorist coverage, that coverage will pay you if you get into an accident with someone who has no liability coverage. Underinsured motorist coverage is similar- it pays out if the other driver has liability coverage, but does not have as much liability coverage as you do. Uninsured motorist coverage is important, because in an accident where the other driver is at fault, it is that driver's responsibility to pay for your damages, which he cannot do if he has no liability insurance.

"Full" Coverage

Full coverage may sound useful, but, unlike liability or collision coverage, it is not a specific kind of coverage. It is instead the name for a bundle of different coverages that an insurance company offers to customers as one unit. Full coverage doesn't have a constant definition, because any insurance company can put whatever they want into a full coverage bundle. Generally, a full coverage package provides all of the local minimum requirements for insurance, but there might be no additional policies in the package, or there might be many -- it depends on the company.

UIM and Full Coverage

This means that even if your policy is called "full coverage," there is no guarantee that it has uninsured motorist insurance included. Whether or not uninsured motorist coverage is necessary and how much to buy changes based on each person's preferences, so discuss options with the insurance company to be aware of exactly what the current contract covers. If you decide you want uninsured motorist coverage, it might not be a part of the current policy, no matter how "full" that coverage declares itself to be.

About the Author

Andrew Gellert is a graduate student who has written science, business, finance and economics articles for four years. He was also the editor of his own section of his college's newspaper, "The Cowl," and has published in his undergraduate economics department's newsletter.

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